Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
ARES Management delivered strong Q1 FY2026 results with revenue surging 29.3% YoY to $1.30B and net income more than tripling to $142.6M, though operating cash flow declined sharply and leverage remains elevated at a debt-to-equity ratio of nearly 5x.
Revenue
$1.3B
+29.30% YoY
Source: SEC XBRL
Ares Management (ARES) reported Q1 FY2026 revenue of $1.3B, up 29.3% year over year. Operating cash flow was $406.51M, down 79.6% year over year. ARES's fiscal Q1 FY2026 corresponds to calendar Q1 2026.
Last 4 quarters: 1 beat
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Jun 2026 | 1.29 | 1.32 | Miss -2.3% |
| Mar 2026This filing | 1.24 | 1.36 | Miss -9.0% |
| Dec 2025 | 1.45 | 1.73 | Miss -16.0% |
| Sep 2025 | 1.19 | 1.18 | Beat +0.9% |
Reported EPS of $1.24 versus the $1.36 analyst consensus — a -9.0% miss for Mar 2026.
Compiled by AI from this SEC filing
Revenue grew 29.3% year-over-year from $1.00B to $1.30B in Q1 FY2026, reflecting robust momentum in Ares' fee-based asset management business and continued expansion of assets under management across its credit, real estate, and private equity strategies.
Source: 10-Q Financial Data, Income Statement
Net income jumped 202.3% YoY from $47.2M to $142.6M, indicating significant operating leverage and potentially favorable market conditions or performance fee realizations that disproportionately boosted the bottom line relative to revenue growth.
Source: 10-Q Financial Data, Income Statement
SG&A expenses rose only 5.5% YoY to $240.4M despite a 29.3% revenue increase, demonstrating meaningful operating leverage as the firm scales its platform without proportional increases in overhead costs.
Source: 10-Q Financial Data, Income Statement
Operating cash flow fell sharply by 79.6% YoY from $1.99B to $406.5M, which may reflect timing differences in working capital, fee collections, or changes in fund-related cash flows — a key area for investors to monitor in subsequent quarters.
Source: 10-Q Financial Data, Cash Flow Statement
Total assets grew 4.5% YoY to $28.4B, but total liabilities increased faster at 8.8% to $20.0B, while stockholders' equity declined 9.6% to $4.03B, pushing the debt-to-equity ratio to approximately 4.97x — reflecting the capital-intensive nature of Ares' balance sheet investments and fund structures.
Source: 10-Q Financial Data, Balance Sheet
Compiled by AI from this SEC filing · 2 high, 3 medium, 0 low
Ares carries a debt-to-equity ratio of approximately 4.97x, with total liabilities of $20.0B against stockholders' equity of $4.03B. This elevated leverage increases the firm's sensitivity to interest rate changes and credit market disruptions, which could pressure earnings and liquidity if conditions deteriorate.
Source: 10-Q Financial Data, Balance Sheet
Stockholders' equity fell 9.6% YoY from $4.45B to $4.03B, even as total assets grew. This erosion may reflect distributions, share repurchases, or non-controlling interest dynamics, and if sustained, could signal capital allocation pressures or dilution concerns for common shareholders.
Source: 10-Q Financial Data, Balance Sheet
Operating cash flow dropped 79.6% YoY from $1.99B to $406.5M, a dramatic decline that raises questions about the sustainability and predictability of cash generation. For an asset manager, volatile operating cash flows can complicate dividend coverage, debt service, and reinvestment planning.
Source: 10-Q Financial Data, Cash Flow Statement
Despite strong revenue growth, net margin stands at approximately 11.0%, which is relatively modest for an alternative asset manager and suggests that a significant portion of revenues are absorbed by compensation, fund expenses, and interest costs. Any revenue slowdown could quickly compress margins.
Source: 10-Q Financial Data, Income Statement
Total liabilities grew 8.8% YoY versus total asset growth of only 4.5%, indicating that Ares is increasingly funding its balance sheet with debt rather than equity. This trend, if continued, could constrain financial flexibility and increase refinancing risk in a higher-rate environment.
Source: 10-Q Financial Data, Balance Sheet
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $B | 1.30 $B | 1.00 $B | +29.30% |
Net Income $M | 142.59 $M | 47.17 $M | +202.29% |
SG&A Expense $M | 240.44 $M | 227.91 $M | +5.49% |
Answers draw on this SEC filing and the data on this page
Ares Management's Q2 FY2026 results were characterized by robust management fee growth and record AUM, partially offset by a decline in carried interest and a steep drop in operating cash flow.
Ares Management delivered strong FY2025 results with revenue surging 28.9% to $4.76B and net income rising 19.6% to $527M, driven by robust asset management growth, though elevated SG&A expenses and high leverage remain key watchpoints.
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